Mumbai: In a major decision ahead of poll, the Reserve Bank of India (RBI) on Wednesday in its last bi-monthly Monetary Policy of 2018-19 slashed the Repo Rate by 25 basis points from 6.50 per cent to 6.25 per cent.

The repo (or repurchase) rate is the rate of interest which the RBI charges to lend short-term loans to the commercial banks.With today’s announcement of the RBI, the interest on the loan may fall.

In its last bi-monthly monetary policy, the bank had kept the repo rate unchanged at 6.5 percent and the reverse repo rate at 6.25 percent.

Notably, this was the first Monetary Policy of RBI under the new governor Shaktikanta Das.